All Forum Posts by: Eduardo Aguilar

Hi Guys- excited for you to get your project going. I have a few construction crews that I regularly work with as well as a Draftsman that helps both with drafting plans as well as managing the permit. If you have experience in managing construction, then you should feel comfortable filing an Owner Builder permit. Given your question however, I get the sense that this might be your first time managing a project like this and so would strongly advise that you connect with a General Contractor that you can trust as it will end up saving you a lot of time and money over doing it on your.

I recently helped connect a friend of a friend to one of my contractors who had started the build on his 400 sqft ADU with a contractor that he found online. After nearly a year of construction and about $40K in costs, all that had gotten done was the laying of the plumbing and foundation, the prior of which my contractor had to redo. Once my contractor took over the project, he was able to sync everything up and keep the project on tract to complete it within a 10 week period.

I share this not to discourage you from embarking on this project with you as a manager, but I flip homes and have seen for myself the incredible savings in time and money that can be activated when you have the right person overseeing the project and who has the relationships with the subs that can make sure to push them and hold them accountable. Absent these type of relationships, I've seen to many projects get delay or fully stall out as the disconnected subs end up causing delays or the need to redo work that got done by a different sub. 

Happy to offer up some more insights if you're interested. Feel free to DM me. 

Want to second @David Ramirez's comment regarding the process. Most HMLs fund the construction through draws that require a submission of a request for the funds after a portion of work has been completed. 

This is a good question to ask your hard money lender so that you understand what there process and turnaround consists of when submitting a draw request. There are some lenders that offer up an upfront draw to kick start the project but you'll nevertheless want to have some type of access to funds (whether cash or a credit line) to help front some of the costs knowing that you'll be reimbursed at various intervals throughout the project. 

If you haven't had a chance to check it out, I would strongly advise that you listen to the Rookies podcasts with James Daynard who gives a masterclass in structuring your processes to increase the sucess rate for your flips. Here are the links just in case: 

Part 1  |  Part 2

Hey @Scott Scoville - a great tool that we've been piloting on our projects is called BuildBook. It's designed for construction companies to manage projects and client communications but has some built ins that we've been able to leverage for our Flipping Business. It also allows you to integrate your subs so that you can centralize communication, expenses and project timeline with deliverables in a single app. Here's a link in case you want to check it out. 

https://buildbook.co/

Hi All- circling back to close the loop on this convo. Happy to share that we were able to secure an HML at 85% LTC and officially closed yesterday 12/27. This is despite getting a late start and having to switch the borrower at the 11th hour to make the HML work. Truly appreciate everyones input. For those that doubted, know that there are always options and just need to push through to find something that can make it work.

Want to give a special shout out to @Scott Scoville for his willingness to jump in at a moment where we needed some additional support. We were fortunately able to make this deal work without tieing him up on this project but very much looking forward to collaborating with Scott and many others from the BiggerPockets community in the future. 

We're in the process of submitting our permit application and hope to complete the renovation within a 6-8 week timeline. I'll make sure to keep everyone posted on our progress. If you're interested in following along, let me know as I'm happy to share how we were able to 100% finance this project through the 85% LTC and a Private Money Lender that came in to cover the gap. 

Hi Restyn- yes, we definitely are looking to host at minimum a quarterly webinar. Any topic areas that you're most interested in? 

Hi All- just got the acceptance on our offer for a great flip in Sacramento. This is a 4bed, 2.5 bath, 1800+ sq ft home with a pool. The entire home needs to be rehabbed. The pool is murky and so we're unable to assess the condition but are budgeting to do a surface refinish and replacement of equipment. Here are the numbers: 

Purchase Price: $365,000
Rehab: $100,000
ARV: $570K-$590K
Closing Date: 12/22/23

Ideally we're looking for a HML at 80-90% purchase price plus 100% rehab or 75% ARV. We also work with a small network of local Private Money Lenders for whom we gaurantee a 10% return in 6-months. We limit this to a max of 3 total lenders per project though typically are able to keep it to two. We provide a notarized promissory note and deed of trust to the property that can be registered with the county to secure their investment. Through this partnerships we have currently have $1.5M deployed and had planned on liquidating before any new acquisitions but could not pass this deal up.

My partner and I are experienced real estate and construction professionals. In the past 6 months we have completed 4 flips, have one flipped listing in contract, and have three other projects under construction. I'm a licensed fulltime Realtor (DRE #02077866) with over 80 transactions closed in the last 4 years. My partner is a licensed contractor and has been managing construction projects for the past four years. He was a preferred contractor for Invitation Homes for which he was flipping 4-7 homes a month at its peak in 2020 and 2021. Please reach out if you're a Hard Money Lender or interested in being a private money lender for us. Feel free to DM me with any questions. 

Hi Reinan- not sure if the process is different in NC, but in California, you typically need to be working with a 1031 Exchange Custodian to help facilitate the process. From what I know, a CPA is great in helping you navigate broader financial goals but 1031's are pretty straight forward. (1) Identify the properties or investments that you want to potentially invest the proceeeds into, (2) Sell your investment property, (3) have the 1031 Custodian hold the proceeds to transfer into new asset, (4) secure and fund the new asset. 

If you're interested in investing in the Greater Sacramento Area and want to get some key insights on (1) where to find the best opportunities. (2) how to price out local repairs, and (3) how to work with private money lenders to fund your deals, then make sure to sign up for our free Webinar. Presented by a local Realtor and Contractor, we'll be sharing the tools, strategies and inside knowledge that we're currently using to acquire two properties a month Specifically, we'll cover:

• -Tools to quickly assess value and run your numbers
• -Insights on general costs of improvements, and
• -Strategies for leveraging private lenders

Simply register via the URL here to get the Webinar info. We'll also be sending links to the analysis tools that we use to quickly assess whether a deal is worth our attention or not. Hope to see you there. 

Register at this link here:  https://pire.info/InvestInSac

Hi All- I know that this is an older post but just encountered this question from my client who is looking to set up a MTR Property Management Business. In the quick research that I did, I found the guidance from the DRE at the link below that exempts Owner/Managers and a narrow exemption for folks managing STRs for compensation from the licensing requirement. It does however state that a license is required and "will be enforced" for individuals serving as Agents on behalf of owners managing properties that require a >30+ stay. Absent further clarity I would operate with the understanding that managing STRs offers a gray that you can potentially work around. Managing MTRs or LTRs however, you're better off securing your license to be on the safe side. 

DRE Guidance: https://pire.info/3Py5lgp

Hi @Matias Torres- congrats on the sale and purchase!!! I’m truly excited for you guys. Similar to my previous recommendation I’d recommend talking to a tax pro as I am not one, but know enough to flag that simply pursuing a Wyoming or Delaware registered entity yields very little benefit depending on where you’re based out of. 

In California, the registration of the entity in another state does not shield it from state related taxes especially if the business is transacting primarily in California.

Just sharing this to offer up some food for thought to help you focus your energy and not waste your time pursuing a “universal” strategy (i.e. WY/DE) as it may not yield the desired outcome. Would love to hear some more info and how the process is going. Definitely wish you the best.